Looking to raise finance? A commercial re-mortgage might help in different ways.

There are always different ways to find the right solution for a client wanting to raise finance. We will try to look at the varied financial options to achieve our clients’ goal and figure out which would be the right deal for them and their business. 

Re-mortgaging is one of these terms that we hear often, sometimes without necessarily understanding what it means. A re-mortgage is a change of the mortgage deal on your property, either by switching it to a new lender, or by moving to a different rate with your existing lender. It can be an effective way to find lower interest rates and better mortgage terms, but what you are generally doing is “swapping” the terms you have for different terms, with different conditions attached. 

Why can a re-mortgage be a good idea?

There are lots of reasons why borrowers might choose to re-mortgage their commercial property.  

• Often, if your current deal is about to expire, you will then be out on your provider’s standard variable rate, which tends to be much higher. Re-mortgaging can therefore help you to move back onto a lower interest rate.  
• If you need cash for your business for purchase, expansion or other reasons, you might be able to release equity from your property when you re-mortgage (A way of accessing cash from your property without moving.) 
• If the value of your property has increased, your lower loan-to-value might help you qualify for better interest rates. 
• If your business has done well and you have managed to build up a cash reserve, you might be able to use this money to offset against your mortgage debt with an offset deal. An offset deal is a loan with lower monthly repayments. 
• Finally, you might just be able to get a better deal thereby reducing your monthly payments and improving cashflow. 

ASC might be able to help you, we have, after all, been supporting businesses with their lending needs for over fifty years. Contact your local ASC office to support your finance application.